(Bloomberg) — HSBC Holdings Plc said a growing demand for larger homes during the pandemic would further boost Dubai’s property market, echoing analysts at Morgan Stanley who expect the rally to last for “several years.”
“The reported sales rebound in Dubai year-to-date has been remarkable,” HSBC’s Stephen Bramley-Jackson and Alok Baid wrote. Despite supply concerns and negative population growth, “the globally synched post-pandemic migration to larger homes is also reigniting Dubai’s residential property market,” they said.
HSBC raised its recommendation on Dubai’s top developer Emaar Properties PJSC to buy from hold, saying the stock offered more than 90% correlation to property prices. Emaar, which reported a threefold increase in five-month sales, represents the “best means” of capturing the trend for the migration to larger homes, the analysts said.
Business activity in Dubai has been picking up alongside a rebound in tourism and a fast distribution of coronavirus vaccines. The city has remained relatively open during the pandemic, and buying real estate is also one of the fastest ways for foreigners to get a residency permit.
For properties worth at least 10 million dirhams ($2.7 million), a record 84 changed hands in March alone, according to data from real estate consultant Property Monitor.
More from the report:
- Emaar Properties price target raised to 5.20 dirhams from 3.83 dirhams
- Emaar Development PSJC, the United Arab Emirates-focused unit, upgraded to hold from reduce, with price target increasing to 3.89 dirhams from 2.51 dirhams
- Price target for Emaar Malls PJSC, which had the rating kept as hold, was increased to 2.03 dirhams from 1.81 dirhams
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